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David Camp Director, economics, AECOM


major change has been the consolidation and commer- cialisation of the top end of the industry. Players have come and gone as private

equity groups spotted the potential to increase the fi nancial performance of the commercial attraction opera- tors. There have been many positives to come out of this process: attrac- tion operators have become more professional, as the ownership moved from families to companies to groups; greater levels of consumer research have led to far more customer-focused attractions; and regular investment in new rides and attractions have kept visitors coming back. However, the private equity groups

are not attraction lovers. They view the sector as a business in the same way they would a manufacturer of widg- ets. Their chief motivation is to get in cheaply, build value and exit with a profi t. This is fi ne if they understand the sector – the need to put custom- ers fi rst and the fact that attractions need to regularly invest just to stand still. Many have, and the growth of the Tussauds Group and now Merlin Entertainments shows what supportive backers and a solid management team

can do together. Unfortunately this hasn’t always been the case and there are some attraction businesses strug- gling to meet overambitious targets set by their fi nanciers. While the market isn’t conducive to sales currently, as soon as things improve there will be another round of transactions.

CHALLENGES A huge challenge in the UK is the low value that government places on the sector. The foot and mouth epidemic of 2001 showed how disparate the attractions and hospitality industries are. While farmers spoke received gov- ernment compensation for their losses, thousands of small attractions, hotels and other tourism businesses strug- gled or closed, as people stayed away from the countryside. An estimated 20-30,000 tourism jobs and more than £5bn in tourism revenue (more than 10 times the cost of culled farm stock) was lost as a result of the epidemic but this received little coverage. The attractions industry is a vital

driver of tourism revenues and employs hundreds of thousands of people, yet is not seen as a real busi- ness sector. There’s an outcry if one factory closes with the loss of 100 jobs, yet many times more jobs have been lost in small businesses around the country. We need to work together more in the future.

Camp is head of AECOM’s European & Middle East team

FUTURE CHANGES Internet and mobile communications are only just impacting the indus- try. Most attractions have web pages, but few use them for much more than a poster advert. This is largely a resources issue, but costs will come down and more companies will offer services to small attractions. Then they can use mobile communications to make daily offers, promote deals and communicate with customers more effectively than they can currently. However, the clamour for customer attention is growing ever louder and the challenge will be in being heard among the multitude of other busi- nesses that will be doing the same.”

Lesley Morisetti Director, LM Associates

“T 26

he development of branded midway attrac- tions, especially for younger children (for example, Legoland

Discovery Centre, Kidzania, Thomas Land), and the licensing of brands has grown, as it becomes increasingly chal- lenging for operating profi ts alone to fund larger standalone attractions, in particular new theme parks. Other major changes include consol-

idation of ownership and the creation of powerful operating groups in Europe, plus the removal of entry fees for the UK’s National Collections in 2001. The economic downturn makes sourcing development funding more

challenging, but experience shows that success or failure of a new attraction is more aligned to whether or not it’s the right concept in the correct location, rather than as a result of the short- term impact of the economy.

Customers have increasingly high

expectations and a growing desire to customise and share their experiences. Successful attractions operators ensure they have a depth of understanding of their customers and put them at the forefront of all decisions. From a product perspective, the

most fascinating debate for the indus- try will be the balance between created experiences and the real thing. The ability to ‘trick’ us into thinking that we’re experiencing reality – whether it’s a thrill ride or a cultural experience – and to enhance that reality to provide a physically impossible experience is forever increasing. However, I still believe there’s a role

Morisetti provides independent advice to attractions Read Attractions Management online

for the real experience – you just can’t beat the exhilaration of a roller coaster or the beauty of seeing original paint- ings and artefacts.”

AM 2 2012 ©cybertrek 2012

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